Tag Archives: Department of Trade and Industry

Marketing of Franschhoek wines in China has tourism benefit too!

China is the ‘promised land’ of future tourism to our country, once the English of Chinese tourists improves, and they start becoming self-drive tourists.  The work that the South African wine industry is doing in general, and at La Motte and Leopard’s Leap specifically,  will have a tourism benefit, as they cannot sell the products without communicating its heritage and values, says Hein Koegelenberg, CEO of both wine companies.

Hein started the companies’ focus on China four years ago, having withdrawn from the USA due to an agency problem in that country.  This freed up time and money to invest in Asia, Hein working with agencies due to the difficulty in communicating the brand message in this region, especially as our country is not yet well-known to the Chinese. Having developed a distribution network for marketing La Motte and Leopard’s Leap wines locally and in Europe, Hein used this ‘intellectual property’, as he calls it, to develop a distribution network in China. Creating a link to the end consumer is important, he said.   James and Michelle Tan, who have previously marketed Rooibos tea and Northern Cape minerals to China, were brought on board to guide Hein in selling into China.  One of the first projects was to set up a selection of wines in golf clubs, one of the places in which Chinese drink wine outside of their homes (they do not drink it at home), leading to a type of vinotheque, which stores each golf club member’s wine collection at the club.  Ernie Els, La Motte, and Leopard’s Leap wines and more were offered as a package of good wine brands to the golf club members.  A substantial target has been set for sales of Leopard’s Leap and La Motte by the Tans.  Agencies were appointed to sell the wines into China, Hong Kong, Indonesia, Vietnam, Singapore, and Laos, the emphasis being on marketing specific brand varieties into specific regions.

Within China, Hein is using three distribution systems for his wines:

*   Aussino Wines China,  the company’s CEO Robert Shen being named by Decanter as the 16th most influential person in the international wine world, and with a network of 120 wine shops.  His company sells 150000 bottles of Leopard’s Leap and La Motte, being the only South African brands stocked, by agreement.

*   A joint venture with Yangzhou Perfect, the second largest direct sales company selling only organic products, and has a turnover of R12 billion.   It has 5000 outlets in the Yangzhou region, and 500000 – 1 million agents buy the products of the company, add an agreed mark-up, and then sell them door to door, much like Tupperware sells its products.   Given the tax of 50 % of wine imported into China, efforts are underway with Wesgro, WOSA (WInes of South Africa) and the Department of Trade and Industry to get the tax reduced (New Zealand only pays 30%), the saving in tax being earmarked for the marketing of South Africa in China. Perfect created a wine brand to test sales via its distribution network, and sells 1,5 million bottles. In marketing wines in China, Hein emphasised that Biodiversity is an important foundation, in that it reflects family values and heritage, as well as caring for the environment and for people.  Selling product only leads to it being price-based, which does not create loyalty.  Chinese wine drinkers are trusting imported brands increasingly, having been exposed to fake Chinese wines.  Hein said that 25 % of all Chinese wine sales are of imported wines. Imported wines are predominantly from France (35), from Chile (8%), Australia (8%), with South Africa at 3%.  Half of the South African sales to China are for Hein’s brands.  Wine imports to China are expected to double to 50% of total wine sales in the next five years.  China is the sixth largest wine producing country in the world, ahead of South Africa at eighth position.

Hein has formed Perfect Wines of South Africa, 51% owned by Yangzhou Perfect and 49 % by Leopard’s Leap. For this new venture they have created a new wine brand called L’Huguenot, with more sugar (5% compared to 4 % locally), and choosing wines that pair well with the more spicy Chinese food, being a 50%/50% Shiraz/Pinotage blend, a Chenin Blanc, and a La Motte-style Shiraz.  This new L’Huguenot brand sold 400000 bottles in the first ten days of its launch in China, about 30% of its initial sales target, which will grow to 2,5 million bottles.  The marketing of L’Huguenot, a brand name chosen specifically to link the brand to Franschhoek and its heritage, will also focus on the marketing of Franschhoek, and the Franschhoek Wine Valley association is working on how to do this in Chinese, probably starting off with a Chinese website page, as WOSA will be doing shortly.  Hein’s next challenge is to create a visible consumer interface for L’Huguenot, as he has just completed for Leopard’s Leap. His challenge is what to ‘pair’ with this new wine brand.

*   Hein has also created his own direct sales channel via a company he created, called Prestige Wines. He seeks corporate networks to link in to. The first network is with the Tsinghua University of Beijing, the largest business university of the city, with 3000 CEO members in its alumni club.  An agreement will bring four groups of 50 alumni each to Franschhoek a year, to grow to four groups of 100 over time, giving these influential alumni the opportunity to experience Franschhoek.  A group visited Franschhoek ten days ago, and they played golf, ate at Pierneef à La Motte, and were addressed by former President FW de Klerk, who pleaded to the businesspersons to bring investments to South Africa.  Hein told me at the Leopard’s Leap launch last Friday that they had signed up R1,5 million in wine sales from this lunch alone. They were shown the L’Ormarins Motor Museum, and had a hands-on experience with the harvesting of the vines and tasting of the wines.  A Golf Day which Hein had organised raised R1 million for the alumni bursary fund. Another project Hein is working on is providing a bottle of wine with every Mercedes Benz sold in China, this being the best selling car brand in the country.  A good working relationship has been developed with the 5-star Shangri-La hotel group, and a brand co-operation agreement will no doubt be put in place with them too.  Chef Chris Erasmus of Pierneef à La Motte is to travel to Hong Kong, Malaysia, and Singapore later this year, Hein told me.

Leopard’s Leap sells its wines in 41 countries, with 20 % each sold locally, in the UK, and in Belgium/Holland. Sales to China are at 9%, and Hein is excited about the potential to double this.  The brand was started as a second label, taking up the left-over grapes of the three Rupert Franschhoek wine farms L’Omarins, Rupert & Rothschild, and La Motte, represented by the three leopards on the label.  The brand was created 12 years ago, and was initially only bottled and sold in the UK, with the assistance of Simon Halliday. Local sales started five years ago.

Hein believes in focus and excellence, and China will be his focus for this year, he said.  There are no new projects this year, with his focus on detail to achieve the goals. While Hein says that he has not had the time to learn Mandarin, he does have Chinese characters for his name and title on his business card.  He told me that his Chinese name is Gu Hai Ning, the last name meaning ‘calm ocean’, a description that he was given to describe his face.  Hein is the first to admit that the work and success is not his alone, and he praised his team of Wanda Vlok handling Marketing, Marius Kotze handling Sales, Leopard’s Leap winemaker Eugene van Zyl, and Kareen Neethling handling Logistics and Planning.  Grapes for the production of Leopard’s Leap wines are mainly sourced from Wellington, Ashton, and Perdeberg.

With the focus of La Motte, L’Huguenot, and Leopard’s Leap on the Chinese market, Franschhoek tourism players will need to start learning Mandarin, given the marketing benefit that the village is likely to experience in future.

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com Twitter: @WhaleCottage

Design Indaba Expo 2011 showcases Cape Town as design capital of South Africa!

Yesterday I became excited about another dimension of Cape Town – I attended the Design Indaba Expo, the first time that I have attended any aspect of the Design Indaba in its 16 year history.   I am so sorry that I was not better informed about this amazing event in the local newspapers or on radio, and had it not been for Twitter I would not have known about it.   I was blown away by the quality and diversity of design, by mainly Cape Town based designers, in the jam-packed Cape Town International Convention Centre exhibition hall, and must congratulate Ravi Naidoo and his Design Indaba team for the excellent organisation, and leading-edge design on display.  I would urge all design-lovers in Cape Town to visit the Design Indaba Expo this weekend.

There is such an overwhelming number of exhibitors, in relatively small stands, that one blindly moves from one stand to another, trying to not miss anything in the vast hall.   No exhibitor map or list is provided when one buys the ticket outside the hall, and the Design Indaba Info stand is in the centre of the hall (not visible when one enters), and I only saw it near the end of my long walk through the exhibition.   Here I was able to obtain a “Visitors Guide”, which lists each of the roughly 250 exhibitors, and contains the floor plan, so that one can find the exhibitors, as well as the programme for the fashion shows and film festival, forming part of the Design Indaba programme.  Designers were chosen by a panel of industry experts, the Visitors Guide explains.   What I did observe is that many designers are brand new at their design businesses, and rather poor at their marketing, not having business cards and/or brochures with them, or having handed all of them out during the first day of the Expo.  Pierre le Roux was one of the most interesting designers at the Expo, in my opinion, but has no business card and not even a website.  Pierre described his furniture as being works of art more than functional seating.  To obtain further information and contact details of all the designers, one has to buy  a “Buyers Guide” at R100, which I decided to do, to use at a later stage – sadly Pierre’s details are not in the Buyers’ Guide either.  This information deficiency was the only flaw in the Expo that I experienced.   

Near the entrance was an impactful rainbow-coloured display to attract attention to Cape Town’s bid for Design Capital of the world in 2014.  Attendees were invited to sign the base of the display, to show their support for the bid.   Next to it stood a five-tier cake by Charly’s Bakery, which reflected different aspects of Cape Town.   in the exhibition hall one can loosely pick up a grouping of similar designers, including furniture, fashion, jewellery, craft, interior design, product design, advertising, architecture, publishing and many more design disciplines.

The furniture exhibits probably attracted the most attention, because the exhibitors required more space, and they tended to not be confined within exhibition stand walls.  I was impressed by the differentness of an outdoors chair made from pipes (left), as well as the new stainless steel tub chair from the Sofa Studio in Franschhoek.  Other furniture designers at the Expo include the Western Cape Furniture Initiative, Haldane Martin, Cabinetworks, Pierre Cronje, Raw Studios, Recreate, Pedersen + Lennard, …XYZ Design, and a most cleverly named Flower Power, making lamps shaped like proteas. 

The 24 jewellery stands probably were the most popular in general, attracting a lot of visitors.  The work exhibited was more modern and contemporary, some quirky, very creative, some art, some organic, some romantic, and all unique and non-commercialised.  The University of Stellenbosch Jewellery Design department also exhibited its students’ work.  Ceramic exhibitors include Liesel Trautman, Diana Ferreira, fun Zizamele Ceramics, John Bauer, The Potter’s Workshop, Tamarillo Ceramics & Design, Clementina Ceramics,  Hennie Meyer Ceramics, Imiso Ceramics, Sootcookie Ceramics, Tania Babb Ceramics and Wonki Ware.   Craft exhibitors include Woodhead’s, Usisi Designs, Cupcake Country, The Cape Craft & Design Institute, Phumani Paper, Design Afrika, Monkeybiz, The Letterpress Company,  Nicfredman Art and Design, Molten, The Beloved, and many more.   Fashion took up a lot of exhibition space, and was popular.  Exhibitors include Tjerrie, Matblac, GOOD Clothing, Coast & Koi, Spilt Milk, BlueCollarWhiteCollar, Homework, Mielie, Township Patterns, DURCHZUG, FACT, Baie Nice, Continent Africa, and MeMeMe.   Lifestyle designers exhibiting are Pepper Plum Designs, Yda Walt Studio, Flick Glass, Fundi Light & Living, Carrol Boyes, Chic Revolution, Tintown, Anatomy Design, and Ikhaya.  Some of the names of the designer businesses are as creative as their craft!

There are two separated design areas within the Design Indaba Expo.  The first is The Salon Privé, ‘focusing on the crème de la crème of South African design.  The Salon Privé is independently curated and designers are encouraged to use the platform to launch a new product or product range.’    In this space the Ardmore ceramics table attracted attention, as did the Veuve Clicquot champagne bar, where I indulged in a glass of their Rosé bubbly at R99, served in a most beautiful unusual champagne glass, nothing like I have ever seen before, without a stem.     Other exhibitors are architects Haldane Martin, Johannesburg-based interior designers Tonic (which one hopes will open in Cape Town too), Willowlamp, Zenzulu, Egg Designs, Ronel Jordaan, ZENZULU, and more.  Close by was a collection of small stands dedicated to “Emerging Creatives”, but it is not explained in the Visitors Guide, other than that there are 60 first-time exhibitors, under the heading “New Kids on the Block”.  The Department of Trade and Industry also had a conglomerate pavilion with about ten exhibitors, including Abode Designer, Veldt designers, Zan Zan décor, Drift Furniture, Keiskamma Art, Master Wires and Deesigned Beads.

For the hungry and thirsty Expo-goers, one can buy Woolworths’ coffees and rolls, or buy sandwiches and other foods from the Earth Fair Market.   Grolsch has an interestingly designed stand too.   Whilst I sat down at the table to have my cappuccino, I had the most wonderful experience in reconnecting with Mark Robinson, whom I had last seen twenty years ago when we both consulted to the then Colman Foods.  The lady that took his seat when he left shared a background in PR and marketing with me.   This was another enriching dimension of the Expo. 

Alongside the Design Indaba Expo is the update of the Cape Town Design Route, and this is an exciting longer-term manifestation of Cape Town’s design wealth, in that tourists and locals can visit more than fifty designers in the city throughout the year.   The Cape Town Design Route designers are all exhibiting at the Design Indaba Expo.  The updated Cape Town Design Route 2011 map was lying at the entrance to the exhibition, without one being alerted to this wonderful design highlight.  I had read about the Design Route by chance last year, and this is the first time that I have seen a map for it.  I was so inspired about the Cape Town Design Route at the time that I wrote a blogpost about it, and will write a new one about the Cape Town Design Route 2011.

Film and fashion events take place inside the Expo throughout the exhibition days, and the programme of events is detailed in the Visitors’ Guide.   Childrens’ design and art workshops are also on the programme throughout the weekend.   

Last year the Design Indaba became infamous due to the spectacle Martha Stewart made of herself as the keynote speaker at the Design Indaba Conference – this year the Design Indaba will be remembered for the most wonderful showcase of design in Cape Town!

Design Indaba Expo, Cape Town International Convention Centre, Cape Town.  Tel (021) 465-9966.  www.designindaba.com.  Today 10h00 – 20h00, Sunday 10h00 – 18h00.

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com  Twitter: @WhaleCottage

New R1/2 million marketing slogan for South Africa hits trash can!

Don’t you just love it when you read that a R140 million tender, which included coming up with a new international marketing slogan for South Africa, generated a slogan that is not any more creative than the previous boring slogan, and is not original, in having been used in other countries!   Now it has been canned!

Last week the government approved the new slogan “More than you can imagine…” for South Africa, reports the Cape Times.   The contract was handled by the International Marketing Council.  The slogan will be used not only by the International Marketing Council, but will also be adopted by S A Tourism for its marketing of South Africa as a tourism destination.   The new slogan replaces the meaningless slogan: “Alive with Possibility”, as it had slipped in its popularity rating to 64%, it is reported.

The only problem is that the slogan is not only totally generic, not creatively and uniquely defining what makes South Africa special, breaking a cardinal marketing rule in finding a positioning that differentiates one from the competition, but also is not unique to our country.   Other uses of the same slogan have been in Portugal, the state of Maryland in the USA, the county Clackmannanshire in Scotland, by a training company in Australia, and in an advertising campaign in the USA!

Themba Maseko, a cabinet spokesperson, said the cabinet did not know of the slogan’s use elsewhere: “When the cabinet approved the slogan, it was not aware it had been used by other countries.  Our understanding was that thorough research was conducted before the recommendation was made to cabinet.”  The International Marketing Council CEO, Miller Matola, defended his Council’s slogan choice on the basis that it has not been used for any other country!

Now the government has canned the slogan due to its use elsewhere, reported the Sunday Times.   “Once it had been brought to our attention that the slogan was not original, we had to investigate”, government spokesperson Vusi Mona is reported to have said.   Bodies that had been consulted in the development of the slogan included the Departments of Tourism and Trade and Industry, Nedlac, S A Tourism, and the provinces.  Excluded from the consultative process was the tourism industry! 

The slogan development is part of a four year R140 million contract to market South Africa via the International Marketing Council, and cost R470000 to generate.

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com   Twitter: @WhaleCottage

World Cup liquor licence fee a damp squib

Venues that have a TV set and charge clients to view the World Cup matches in their venue, will be expected to apply for a R 50 000 liquor licence, reports Business Report.

The initial announcement by the Department of Trade and Industry about the liquor licence requirements for the World Cup was met with shock, as it sounded as if it was an additional licence that all businesses would have to apply for.  However, it appears that the Department misread FIFA’s rules, and had to backtrack, and clarify that existing liquor licence holders would not have to apply for another licence, if they do not charge an entrance fee to view the matches, and if the viewing event is not sponsored.  

The Department of Trade and Industry is hardly likely to be able to process the applications for such special licences anyway, in time for the World Cup, which starts on 11 June, says the industry.

As far as beer sales go, Budweiser, being a FIFA sponsor, will sell its beer inside the World Cup stadiums, but a no-name brand Castle is expected to be sold in the fan parks, to not clash with Budweiser’s sponsorship.

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com